Smart Ways to Approach Equity Release Without Selling

If a lender approves it, you can refinance or top up to a higher loan amount and take the difference as cash. How much you can access depends on the valuation, the lender's maximum loan-to-value ratio and your ability to meet the repayments. The trade-off is simple to state. You borrow more, so you pay interest on more.

Ambulance officers have steady, award-based income. Overtime and penalty rates can vary from roster to roster. That matters here, because lenders look hard at repayment capacity when the debt goes up. This article covers how equity release works, what it costs and when it makes sense.

How Do You Access Equity in Your Home Without Selling?

You access equity by borrowing against the gap between your home's value and what you owe. If the lender approves the application, it sets a new, higher loan limit and you receive the extra as cash or in a separate loan account. The lender must also assess that the loan is suitable for you and that you can afford the repayments.

A lender will order a property valuation to confirm what your home is worth. Lenders generally want you to keep at least 20 per cent equity after the release. If you go below that, you may have to pay lenders mortgage insurance (LMI), which adds to the cost.

There are two main routes. You can refinance your whole loan to a new lender and add the extra amount, which is often called a cash out refinance. Or you can ask your current lender for a top-up. Our equity release loans for paramedics page explains the options we compare for emergency service workers.

What Does Equity Release Cost You in Repayments?

Releasing equity increases your repayments and the total interest you pay, because the debt is larger and may run for many years.

As an illustrative example, take an ambulance officer who tops up their loan by $60,000. Assume an illustrative rate of 6.75% p.a. and 25 years left on the loan. The extra repayment on that $60,000 is about $415 a month. The actual figure depends on your lender, your rate and your loan term. Use our borrowing capacity calculator to test your own numbers.

If the officer stretched the top-up over a longer term, the monthly amount would fall. They would pay more interest over that longer period, and a lender or broker should tell you this up front.

Should You Use Equity for a Renovation, an Investment or Both?

Use equity for something that adds value or builds wealth, and avoid using it for spending that leaves you with nothing to show for the extra debt.

The example officer wants to renovate the kitchen and bathroom. The $60,000 top-up is for that work. The solution is to release only what the quote needs, plus a small buffer for cost overruns. The outcome is a repayment rise of about $415 a month. The officer checks that this sits comfortably against base pay, and treats overtime as a bonus rather than a requirement. If it fits, they proceed. If it is tight, they cut the scope or release less. See our renovating your house page for more on funding works.

If you want to use equity as a deposit on an investment property, the strategy changes. You are borrowing against your home to buy an asset that may or may not rise in value. Rent may not cover the repayments, and your own budget has to carry the gap. Our debt recycling page covers a related strategy that aims to turn home loan debt into investment debt over time.

Is the Interest on Released Equity Tax Deductible?

The tax treatment depends on what you use the money for, not on the property that secures the loan. Speak to your accountant before you act.

The ATO allows interest deductions on money borrowed to buy a rental property or fund deductible expenses for it. It does not allow deductions on borrowed money used for private purposes, such as a renovation to your own home or a holiday. If you borrow one amount and split it between private and investment use, the interest has to be apportioned. Keep clear records of how each part of the money was used.

Negative gearing rules have also changed. The treatment turns on when a property was acquired and whether it is an eligible new build. Whether refinancing or increasing a loan affects the treatment of a property already held at 7:30pm AEST on 12 May 2026 should be confirmed with your accountant or the ATO before you borrow to invest.

What Fees Apply When You Refinance to Release Equity?

The common costs are a discharge fee on your old loan, an application fee on the new one and, if your rate is fixed, a possible break fee. LMI may also apply if your equity falls below 20 per cent.

Lenders cannot charge an exit fee on a residential loan that started on or after 1 July 2011. That prohibition does not cover break fees or discharge fees. A break fee applies only if you leave a fixed rate before the term ends. If your fixed rate period is ending soon, waiting until it expires can avoid that cost. The right time to release equity may be when the fixed term finishes.

In a refinance, the lender must also assess your repayment capacity at a higher rate than the one you will pay. APRA has confirmed the buffer stays at 3 percentage points above the loan rate. If you are refinancing to a new lender and borrowing more, expect closer scrutiny than on a like-for-like switch.

Check Your Loan First Before You Release Equity

A review of your current loan often shows whether you can lower your rate or improve cashflow before you borrow more.

If you are paying a high rate, refinancing to a lower one may reduce repayments enough that a modest equity release costs you very little extra each month. Our home loan refinancing for paramedics page explains how a switch works. A loan health check shows where your loan sits today, and you can see how we work with ambulance officers across Australia.

Call one of our team or book an appointment at a time that works for you. We will review your loan, work out how much equity you can access and show you what it costs, so you can decide with the numbers in front of you.

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